Vedder Price is pleased to announce that four attorneys have been named Shareholders in the firm, effective April 1, 2021.

“On behalf of the Executive Committee, I’d like to congratulate Michelle, John, David and Jeff on this career milestone,” said Dana S. Armagno, Vedder Price Operating Shareholder. “This group of lawyers is deeply committed not only to ensuring the success of our clients, but to building the firm of the future. Their focus on delivering outstanding client service will help the firm grow and succeed in the years ahead and we look forward to working with them in their new leadership roles.”

Michelle T. Olson, elevated from Associate and a member of the Labor & Employment practice area in the Chicago office, also serves as Co-Chair of the firm’s Pro Bono Committee. Ms. Olson regularly counsels employers on day-to-day employment law and human resources matters, including federal and state antidiscrimination laws, medical leaves of absence and accommodation requests, employee discipline and discharge, whistle blower and retaliation claims, and wage and hour violations. She helps employers navigate challenging workplace investigations, including allegations of harassment, bullying and retaliation, and provides employers with thoughtful and practical advice in the development of separation and settlement agreements, employee handbooks, training programs, and related policies and procedures. From 2016 to 2020, Ms. Olson was selected as an Illinois Rising Star in Employment Litigation: Defense by Super Lawyers. She earned her J.D. from Northwestern University School of Law, cum laude, and her B.S. from the University of Illinois with highest honors.

John K. Burke, elevated from Associate and a member of the Intellectual Property and Intellectual Property Litigation practice groups in the Chicago office, regularly counsels clients in patent, trademark, copyright and trade secret matters, with a focus on intellectual property litigation, prosecution and transactional matters. In 2021, Mr. Burke was recognized by The Best Lawyers in America: Ones to Watch in the field of Intellectual Property Law. Prior to law school, Mr. Burke spent three summers working at a major semiconductor manufacturer and obtained his Bachelor of Science degree in Electrical Engineering. He earned his J.D. from The University of Notre Dame Law School, magna cum laude, and his B.S. from The University of Notre Dame, cum laude.

David N. Swendsen, elevated from Associate and a member of the Finance & Transactions practice area in the Chicago office, executes transactions from start to finish on behalf of his clients. He has in-depth experience in traditional buy-side/sell-side M&A, minority investment transactions and venture capital transactions. Mr. Swendsen specializes in private equity and investor-side representation. He also acts as outside general counsel for start-up and middle-market clients, drafting and negotiating key commercial contracts and advising them on a variety of legal matters. Mr. Swendsen was recognized by The Best Lawyers in America: Ones to Watch (2021 Edition) in the field of Mergers & Acquisitions Law. Prior to joining Vedder Price, Mr. Swendsen was a Supply Chain Management Consultant in Chicago, where he developed cost-saving solutions for his clients. He earned his J.D. from the University of Illinois College of Law, magna cum laude, and his B.A. from the University of Illinois.

Jeff VonDruska, elevated from Associate and a member of the Investment Services group in the Chicago office, represents investment advisers, family offices, private funds, registered mutual funds, closed-end funds, exchange-traded funds and other financial institutions on a broad range of legal, regulatory, governance, formation and compliance matters. Mr. VonDruska has significant experience in regulatory and compliance matters affecting investment advisers, including registration and marketing. He also counsels clients with respect to examinations and investigations conducted by the Securities and Exchange Commission and other regulators. Mr. VonDruska has been selected for inclusion as an "Illinois Rising Star" by Super Lawyers Magazine in 2019 and 2021. Prior to joining Vedder Price, Mr. VonDruska worked as counsel for a large fund of hedge funds adviser. He earned his J.D. from the John Marshall Law School, cum laude, and his B.A. from Lake Forest College, with distinction.

Vedder Price is pleased to announce that Martin Martinez and Hayleigh Shobar, both first-year law students at the University of Chicago Law School, have been named Diversity Scholars in Chicago and New York, respectively. This is the 17th year Vedder Price has offered the scholarship, which provides both a monetary award and placement in the firm’s Summer Associate Program.

Mr. Martinez will assist with the firm’s Corporate, Labor & Employment and Litigation practice areas. Prior to attending the University of Chicago Law School, Mr. Martinez served as a Community and Organizational Affairs Coordinator and Bankruptcy Court Help Desk Coordinator for Legal Aid Chicago, where he established community clinics to educate Chicagoans on issues surrounding debt and bankruptcy. Mr. Martinez received his undergraduate degree from Brown University and traveled the country as a varsity track athlete, earning All-American honors. Currently, he serves as a 1L representative for the Latinx Law Students Association and is the Tony Patiño Fellow-Elect.

“I know the value that is added in having a workplace that reflects the cultures, knowledge, and various experiences that make up our society. I believe that diversity promotes creativity and new ideas—leading to better quality of work,” Mr. Martinez said.

Ms. Shobar will assist with the firm’s Labor & Employment and Litigation practice areas. As an undergraduate of the University of California, Berkeley, Ms. Shobar was the recipient of the Cal Alumni Student Association Leadership Award and worked as a caseworker for the ASUC Legal Clinic. At the University of Chicago Law School, she is a member of the Latinx Law Students Association as well as a 1L representative for the Law Women’s Caucus and Environmental Law Society.

“As the first member of my family to pursue professional education, the Diversity Scholarship is a tremendous honor,” Ms. Shobar said. “My mom did not have the opportunity to attend college, so she worked hard to prioritize education for me and my brother. I attribute my love of learning the law to the curiosity she fostered in me growing up and feel very lucky to start my legal career as a Diversity Scholar at Vedder.”

“We are excited to welcome Martin and Hayleigh to the firm this summer and are proud of our continued relationship with the University of Chicago Law School and its promising law students,” said Andrew Torre, Chair of Vedder Price’s Diversity Committee. “Both scholars bring a unique and diverse worldview as well as an enormous amount of talent and academic success to the firm. By investing in the next generation of lawyers, we seek to expand and enrich the talent pool across the legal field.”

To learn more about the Vedder Price Diversity Scholarship, click here.

Vedder Price is pleased to announce that Jeremy I. Senderowicz has joined the firm as a Shareholder in its Investment Services group in New York. Mr. Senderowicz joins the firm from Dechert LLP where he was a Partner in its Financial Services and Investment Management group.

Mr. Senderowicz focuses his practice on advising registered investment companies, private funds and their investment advisers on a variety of matters pertaining to the Investment Company Act of 1940, the Investment Advisers Act of 1940 and other securities laws. He has extensive experience representing ETF sponsors and ETF fund complexes. His ETF clients have included a wide range of asset managers, from start-ups to large, established firms.

Mr. Senderowicz has also advised clients in matters relating to cryptocurrency and blockchains, including proposed offerings of bitcoin ETFs and other issues relating to funds which invest in cryptocurrency and the use of blockchains by asset managers and in securities offerings. He has significant experience with forming and providing ongoing advice to registered funds of hedge funds, other types of continuously offered closed-end funds and mutual funds. He has advised numerous clients regarding a wide variety of issues in building out their alternative fund product lines, including fund reorganizations and related board matters.

“Jeremy’s ETF and alternative fund formation experience will provide additional depth to our Investment Services group’s capabilities in areas important to our clients,” said Cathy Gonzales O’Kelly, Co-Chair of the firm’s Investment Services group. Co-Chair Bruce A. Rosenblum added, “He is an important strategic hire as we look to continue to build out our New York-based Investment Services practice and expand our financial services presence in that market. We are very excited to have Jeremy on board.”

“I’ve been familiar with Vedder’s impressive Investment Services group for some time,” said Mr. Senderowicz. “I look forward to assisting my clients and to helping grow the firm’s practice alongside my new colleagues in New York and across the country.”

Mr. Senderowicz earned his J.D. from Columbia Law School and his B.A. from Columbia University, magna cum laude.

On February 2, 2021 Vedder Price’s Pro Bono Committee held a virtual reception to recognize the attorneys and paralegals who dedicated their time to pro bono service in 2020, to draw attention to the important causes in which we partner in our communities, and encourage more pro bono service in 2021. Attorneys and paralegals who reached various milestones were recognized at both an office level as well as on an all-firm level.

The Pro Bono Committee, led by Co-Chairs Michelle Olson and Patrick Spangler, honored those who dedicated the most time to pro bono work in 2020, and those who act as advocates of the pro bono program and encourage involvement from others. The Pro Bono Committee oversees the firm’s pro bono activities and works to develop relationships with pro bono agencies around the world.

Due to the extraordinary need for provision of legal services to those unable to pay, our lawyers are committed to fulfilling their professional obligation to provide pro bono legal services to the communities in which they operate. In 2020, Vedder Price attorneys and paralegals performed 8,790 hours of pro bono legal services, a 22% increase from 2019 and a 54% increase from 2018.

We are proud to recognize the attorneys and paralegals named below for their outstanding commitment to providing pro bono legal assistance to those in need. This year, the Pro Bono Committee also recognized our Los Angeles Office as the winner of our first annual Pro Bono Champion Award, which is awarded to the office with the highest number of pro bono hours per attorney. The LA Office averaged 50.66 pro bono hours per attorney. As the winner, the LA Office will receive the traveling award to display in the office and earns bragging rights for the next year.

All Firm Awards

Most Pro Bono Hours – All Firm – Shareholder – Brett Heinrich

Mr. Heinrich dedicated most of his pro bono time to the Tree Research and Education Endowment Fund, which identifies and funds programs that support the discovery and dissemination of new knowledge in arboriculture and urban forestry. In addition to funding scientific research related to tree care and urban forestry, TREE Fund also supports student scholarships in this area and environmental educational programs for children and adults.

Mr. Heinrich also provided pro bono counsel to the Environmental Health & Safety Audit Center, which advances the professional practice of auditing in the environmental health and safety field.

Most Pro Bono Hours – All Firm – Associate –Ryan Helgeson

Mr. Helgeson contributed a tremendous amount of time to pro bono immigration matters, including a number of pro bono clients who are seeking asylum in the United States. Mr. Helgeson also continues to act as an invaluable resource for others at the firm who are working on pro bono immigration matters. In addition to his tremendous efforts related to immigration asylum matters, Mr. Helgeson also provided pro bono advice to United Cerebral Palsy and worked as the guardian ad litem for a minor who is a ward of the state.

Most Pro Bono Hours – All Firm – Paralegal – Fernando Torres

Mr. Torres assisted several pro bono clients who are seeking asylum in the United States. Notably, Mr. Torres was on the team (including Jeanah Park, Kareem Ratani and Gabe Anello) that helped a couple and their three children from Honduras receive asylum in the United States. The father, a former police officer and chief of police in Honduras, brought his family to the United States to protect them from retribution for his efforts to combat gang violence in their country.

Significant Pro Bono Contributors by Office

Chicago

• Jeanah Park – Shareholder
• Ryan Burandt – Associate
• Rita Mahoney – Paralegal
  
  

London

• Jonathan Edgelow – Associate
  
  

Los Angeles

• Anthony Pacheco – Shareholder
• Nate Wright – Associate
  
  

New York

• Jonathan Wexler – Shareholder
• Victoria Jaus – Associate
  
  

San Francisco

• Scott Olson – Shareholder
• Mindy Wong – Associate
  
  

Washington, D.C.

• Amy Bess – Shareholder
• Aleksandra Rybicki – Associate
• Jonathan Rauch – Associate
  
  
  

Following a turbulent market period fueled by social-media driven trading in so-called “meme” stocks, FINRA has issued a detailed regulatory notice, taking direct aim at certain broker-dealer actions.  Specifically, in Regulatory Notice 21-12 (the “Notice”), FINRA reminds firms that (a) they should have capacity to handle periodic spikes in message traffic and trading activity and (b) unfair disclosures in customer account agreements will not relieve a firm of its best execution obligations for handling customer orders.  The Notice specifically calls out customer agreements that allow the firm “in its sole discretion, [to] prohibit or restrict trading without notice.”  This, along with the statements on regulators’ expectations for systems capacity and the “need [for member firms] to have effective liquidity management practices,” suggests a clear preference against restricting customer trading.  FINRA appears to believe that firms should not manage clearing corporation deposit requirements, liquidity risk, or systems capacity demands by restricting trading, but rather should maintain systems and controls to meet those requirements and demands without restricting trading.  

Best Execution

A significant portion of the Notice reiterates guidance from NASD Notices to Member 99-11 and 99-12 that broker-dealers’ procedures for handling customer orders “must be fair, consistent, and reasonable during volatile market conditions and otherwise.”  Firms must be particularly mindful of their handling of marketable orders during periods of volatility and extreme conditions.  Under FINRA Rule 5310, broker-dealers must execute market and marketable limit orders promptly, and a delay in executing such orders due to an influx of orders or market volatility is not consistent with a broker-dealer’s best execution obligations.

The Notice recognizes that a firm might need to change order-handling practices during extreme or volatile market conditions and even restrict the entry or acceptance of customer orders.  The Notice cautions, however, that firms “must implement such changes on fair, consistent and reasonable terms.”  This is coupled with a direct statement expressing FINRA’s desire that firms endeavor to permit customer trading rather than restrict it.  Specifically, FINRA states that “firms should consider establishing and implementing procedures that are designed to preserve the continued execution of customer orders . . . while also recognizing and limiting the exposure of the firm to extraordinary market risk.”  FINRA also warns that changes to order-entry procedures should be limited, well-documented, and implemented only when warranted by market conditions.  FINRA will not look favorably upon frequent changes to order-handling practices, particularly those occasioned by inadequate systems capacity.  Accordingly, if a firm does need to modify its order-handling practices under extreme market conditions, it should consider the effect of that action.  It should consider which clients might be affected and seek to implement its change in the most fair, consistent, and reasonable manner.  For example, if the concern is reducing risk at clearing corporations, the firm’s order-handling change should be designed to address only that risk, such as by limiting new positions or positions that increase risk, rather than trading activity that reduces or closes risk positions.  If a change is driven by capacity concerns, the change should affect all customers fairly, rather than maintain access for selected categories of clients.  As discussed below, clear and timely disclosure of the nature of the change and the reasoned basis for it are key.

Meaningful Customer Disclosures

The Notice primarily reiterates guidance first published in 1999, during the volume and volatility of the “dot.com” era and the advent of online trading.  The guidance remains relevant today, perhaps even more so, with high-speed internet, smartphones, and trading apps creating additional and faster retail order-entry channels.  The Notice reminds that if firms implement different order-handling procedures in extreme market conditions, they should advise customers in advance of those different procedures and the circumstances that may trigger them.  Certain other disclosures help to advise and educate retail customers about the risks of volatile markets.  For example, customers should be informed of the difference between market orders and limit orders, particularly in volatile markets.  Market orders must be executed promptly, but the “market” can change drastically in volatile markets and the execution price can be far different from what a customer anticipated.  Similarly, stop orders without a limit price become market orders when triggered and brief price swings during volatile markets can trigger stop orders unexpectedly.  Customers should be reminded of these and similar risks and possible ways to mitigate them, including by using limit orders and stop limit orders.  Firms with a broad retail customer base regularly make these disclosures, but the Notice provides a helpful reminder of the need to educate customers, particularly those that are new to trading and now have easier access to the markets.  Again, when this guidance was first presented in 1999, online trading was relatively new.  Since then, retail customers have easier access to the markets and some methods of order entry have less screen space for disclosures.  This makes it all the more important to make meaningful disclosures in advance to customers.

Liquidity Management

One of the more direct warnings in the Notice is FINRA’s reminder that firms must have effective liquidity management programs.  The relevance of this warning is obvious, given the recent effect that “meme” stocks and other concentrated and volatile trading have had on broker-dealers’ (or their clearing firms’) clearing corporation deposit requirements.  FINRA warns that “[m]ember firms facing the potential for rapid changes and concentration in order volume should expect commensurate changes in [clearing corporation] requirements.  It is important for a member firm to model potential [clearing corporation] requirement spikes, and to assess whether it has adequate funding available to meet those spikes.”  Removing any doubt that recent meme stock activity informs the guidance, FINRA highlights “the potential for concentrations of customer activity and trading in specific highly volatile, low-priced or illiquid securities, which may increase” such requirements.

Notably, FINRA issued guidance in 2010 and 2015 on liquidity management practices.  That guidance did not put firms directly on notice of the need to manage liquidity risks from changes in clearing corporation deposits, but the 2015 guidance indirectly and obliquely referenced such risk.  That indirect reference now takes on greater importance following the recent meme stock volatility and the interest of the press, Congress, and other regulators following that volatility.  In the 2015 guidance, FINRA described the testing it had recently performed of certain firms’ liquidity-risk management, including the “stresses” that it asked those firms to apply to their businesses in connection with that testing.  For one of the five stresses, FINRA requested that the reviewed firms “assume a doubling of clearing deposits, whether client or firm related, on Day 1.”  (FINRA Regulatory Notice 15-33 at 4.)  Although the recent meme trading may have resulted in clearing deposit increases far beyond mere doubling, firms are now clearly on notice that FINRA expects appropriate modeling and stress testing of clearing corporation deposits and an evaluation of the “adequacy of capital and availability of contingent funding sources to provide customers ongoing access to the markets.”

Conclusion

Given the significant interest of both Congress and the press in retail investors’ access to the markets during volatile trading in meme stocks and the resulting pressure on regulators to oversee market participants’ activities in this area, it should come as no surprise that FINRA would take a direct and pointed view on core issues relating to best execution, market 
integrity, and investor protection.  The Notice suggests that, going forward, FINRA will be far less tolerant of a broker-dealer failing to adequately manage its liquidity or anticipate clearing deposit requirements, regardless of market conditions.  To the contrary, FINRA appears to require firms to anticipate significant increases in customer orders, not only to maintain sufficient systems capacity, but also to model for clearing corporation requirements and other liquidity needs.  Broker-dealers should take the opportunity to review their order-handling practices under volatile market conditions, the disclosures they provide to clients, and the models they use to stress test clearing corporation requirements and other liquidity management practices.  Broker-dealers that may require additional capital to meet clearing deposit or other requirements should consider lining up contingent sources of capital rather than defaulting to restrict trading.

Vedder Price Shareholder Blaine Kimrey will be a presenter at the 33rd Annual University of Kansas School of Law Media and the Law Seminar, taking place virtually this year on April 14-16th, 2021.

The annual Media and the Law Seminar is co-hosted by the University of Kansas School of Law and the Kansas City Metropolitan Bar Association Media Law Committee, and brings together lawyers, students and teachers, to discuss the latest legal issues and developments in media, law and technology. This year’s program focuses on the potential pitfalls awaiting Instagram and other social media influencers, including the FTC’s sponsored advertising rules, the ethical issues of buying followers, and the myriad of reasons social media influencers can be sued.

Mr. Kimrey will moderate a panel discussion at the seminar, entitled “Defamation 101 – Back to Basics,” on Wednesday April 14th at 3:00 PM CST. The educational panel will be presented via point/counterpoint by lawyers acting as defense and plaintiff’s counsel, running through and engaging the audience on classic defamation claim issues.

For more information and to register, click here. 

Vedder Price Shareholders Michael J. Edelman and Ji Woon Kim will present at the Airline Economics Growth Frontiers Korea Digital event on April 14, 2021.

Mr. Edelman will moderate the session, “Distressed Assets/ Distressed Asset Values” at 9:40 AM. And Mr. Kim will moderate the panel, “High Yield Mid-Age Aircraft Lease and Technical Risks vs. New Aircraft Investment” at 2:20 PM.

For more information and how to register, click here.